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ALPS Provider Profile
ALPS Advisors
is the in-house investment management division of ALPS
Fund Services, which provides back office support to
investment managers, particularly mutual fund companies,
in the form of accounting, administration, legal and
compliance work as well as marketing.
ALPS
entered into in the investment world in earnest with the
acquisition of Liberty Asset Management from Bank of
America almost four years ago.
Around that time they also
hired Corey Dillon as SVP of advisory services after 14
years at Janus Capital, a neighbor of the Denver
based
ALPS.
With three years of
history under their belt for their innovative asset
allocation, risk based mutual funds, ALPS
is making a serious push into the Defined Contribution
(DC) world, especially to plans serviced by financial
advisors.
With a strong
history in the ETF world, especially through ALPS
Distributors which helps ETF providers market their
funds, ALPS
Advisors has partnered with Ibbotson to develop a very
unique asset allocation, risk based product for the DC
world.
Rather than use a
collective trust, ALPS’s product is wrapped in a ’40
Act mutual fund based initially on demand from their
insurance clients.
Though purists still opine
that the actual ETF is the best way to get exposure, by
putting ETF’s in a mutual fund and using an asset
allocation developed by a 3rd
party like Ibbotson, ALPS
product is the best of all worlds.
The product can be used by
all record keepers, participants are not required to
develop their own asset allocation strategies, and
expenses are kept low because the building blocks are
ETF’s capturing upside through the model which includes
a dynamic tilt.
They received 5 tar
ratings for their conservative and growth ETF allocation
portfolio’s and 4 stars for their aggressive growth and
balanced funds.
ALPS Advisors funds are available through record keepers
that clear through Schwab, Fidelity and Matrix and they
expect to be available on larger record keeper platforms
in the near term.
Their five risk based strategies come in two share
classes, one with 25 basis points 12(b)(1) fees with
total expenses ranging from 90-94 basis points, and the
other without 12(b)(1)’s with total expenses ranging
from 65-69 basis points.
Both share classes offer 12.5 basis points to
support administrative costs and the ALPS funds qualify as a QDIA.
With over $1.5 billion in AUM, a three year
history and wider distribution, advisors looking for a
unique risk based strategy using ETF’s wrapped in a
mutual fund should give the ALPS Advisors a careful
look.
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